The current operator of the Mount Orford ski centre would have the inside track in bidding on the portion of the provincial park slated to be privatized, thanks to an exceptional clause in the bill clearing the way for the sale.
Bill 23, amending Quebec's Parks Act, would allow Mont-
Orford Inc. to buy the parkland being auctioned for slightly more than the $15-million market price set by the government.
But for a rival bidder, the price would be $40 million - $15 million for the land, plus an additional $25 million for the new chairlift, snow-making and grooming equipment and other improvements made by Mont-Orford Inc.
Even if its bid is unsuccessful, Mont-Orford still would walk away with $25 million, because Bill 23 changes the cancellation rule set out in the company's 70-year lease.
In public tenders to sell the ski area, golf course and 85 hectares where condos would be built, a successful bidder other than Mont-Orford would have to buy out the operator. That would mean paying the full $25-million residual value of Mont-Orford's investment in the centre as a condition for ending the lease.
The bill also provides that Mont-Orford would get to keep assets it would normally forfeit when its lease on the property ends. Section 10 of the bill states that the assets the government is selling do not include property acquired by Mont-Orford since its lease was signed in 2000.
Environment Minister Claude Bechard said yesterday that Andre L'Esperance, president of Mont-Orford, which pays $10,000 a year in rent under the lease, has written him to say the operation plans to close because Mont-Orford is losing money.
"Mr. L'Esperance has clearly told us he does not intend to continue operations and he is asking us for $20 million,"
the minister said, referring to the government's obligation, if the operator backs out, to
repay 80 per cent of the residual value.
L'Esperance insists that real-estate development is the only way to make Mont-Orford profitable.
"We have to act," Bechard said.
Annie Brunelle, a spokesperson for Mont-Orford, said the company was not involved in drafting Bill 23.
"We have nothing to do with this bill," Brunelle said.
While the government is selling the parkland outright, Bill 23 states that the lease would remain in force, giving the buyer the option of cancelling 12 months after the acquisition.
Bechard points out that Bill 23 would name an environmental group to act as a voluntary watchdog over the project. Yesterday, the minister said he is in discussions with "a few groups," which he declined to name. Environmentalists are united in opposition to the selling of parkland and none has come forward publicly to accept the watchdog role.
The 2000 lease gives the government a veto over any changes in the park and states that Mont-Orford must deduct from the residual value any government subsidies.
Bill 23, however, states that these two sections of the lease "cease to have effect," giving the eventual buyer a free hand and allowing Mont-Orford to count money it received in subsidies as part of its residual value.
L'Esperance, the Sherbrooke businessman who is the principal Mont-Orford shareholder, explained at Bureau d'audiences publiques sur l'environnement hearings that because the company is unprofitable, it can't get bank loans.
"The first question a lender asks is, 'Can you pay me back?' " L'Esperance told the BAPE in 2004, adding that all the money invested by Mont-Orford has come from the pockets of its investors.
The second shareholder in the private company is Paul Gobeil, a businessperson who was a Quebec Liberal minister in the 1980s.
In 2003, Fred Korman said in an interview, Gobeil and Claude Boulay bought control of Mont-Orford.
Korman had signed the 70-year lease in 2000 as one of the original shareholders in Mont-Orford, then called Intermont Inc.
Boulay, who was questioned at the Gomery commission, is the former head of Groupe Everest, a public relations and marketing firm with links to Premier Jean Charest. Charest's communications director, Michel Guitard, is a former Groupe Everest executive.
"The whole thing is political," Korman said, when asked why the Charest government is so determined to privatize the ski and golf areas. "I don't want to go any further.
"Nobody can understand it," he added.
Korman, who operates the profitable Owl's Head ski centre in Mansonville, says the Orford ski centre was profitable for the two years he ran it.
In its March 2005 report, the BAPE noted widespread opposition to Mont-Orford's 1,400-condo proposal, saying the plan could harm the ecological integrity of the park.
Bill 23 calls for a less ambitious plan to build 700 to 800 condos. Bechard refused yesterday to consider holding new BAPE hearings on the revised plan.
kdougherty@thegazette.canwest.com |